Dr Ros Kidd
Historian - Consultant - Writer
Reclaiming the land of the ‘fair go’
*
In
this land of the ‘fair go’ we have always believed that anyone who works
hard to earn a dollar has the right to keep that dollar – after taxes.
We can use our money for food, shelter and necessities for our family,
for transport to find work, down payment on a home, giving our kids a
start in life, spoiling our elders, increasing our own prosperity. But
what if someone else controls your work contracts, takes your wages and
leaves you and your family in shocking poverty? What do you do if they
say they’re better money managers than you, that restricting your access
to earnings will ensure a nest egg in your old age, and then reveal, at
the end of it all, that your account is minimal and they can’t say what
happened to your money? Just imagine if more than half your wages was
taken as compulsory superannuation deductions, if super funds never
publicly accounted for their holdings, and if you got a pittance when
you retired. And if, when you demanded answers, they offered you $4000
or less to go away and forget it!
This is the scenario facing thousands of people who, against their will,
were taken into control by Aboriginal departments around Australia, and
who are now campaigning to get their money back. Tonight I’d like to
share with you my thoughts on this struggle over what we call the Stolen
Wages, and my ideas for how justice might be achieved.
There is little dispute that the original landholders of this nation
have been marginalised in our history, subtracted from our economy,
isolated from our society, sidelined from political processes. One of
the world’s richest cultures, although without written records as we
perceive them, even the voices of Indigenous people were stifled by
those who assumed the power to speak of and for them.
I
think it’s a wonderful irony that it is the written records of these
‘guardians’, amassed in frightening detail through decades of the most
meticulous surveillance, that are now bearing witness to the thousands
of lives previously submerged in our national consciousness. These
records are testament to those long-lost voices which might finally be
heard, calling us to account for our past, our present and our future.
How we deal now with this resource and this responsibility is of immense
importance to our delayed coming of age as a nation.
The removal of thousands of Aboriginal children from their families, the
incarceration of thousands of Aboriginal families in government
institutions and remote reserves, is the biggest social experiment in
our history. The consequent starvation, sickness, scandalous mortality
rates, substandard housing, non- or inadequate schooling, and non- or
underpaid labour show how that duty of care was exercised. This is the
legacy of a century of ‘care and protection’.
Yet the secret and monopoly powers of Native Affairs or Aboriginal
Affairs departments of the past endures in the scarcity of documentary
evidence in the present. Our misconceptions, fed on political and
historical misrepresentations, are difficult to dispel when so many of
today’s spokespersons and politicians – who have never read the evidence
– not only remain fixated in the rhetoric of past agendas but persuade
so many of the public that it is perverse to be critical.
But there is much to be critical about.
In
Queensland, into the 1970s, any person of Aboriginal heritage could be
declared a ward of state, losing all rights over their own and their
children’s lives. A network of police protectors monitored your
domestic life and controlled your employment, generating masses of
information which was consolidated into files kept on every individual.
But there was no way of knowing what was written about you, and these
files remained secret into the 1990s.
This state boasted the most efficient system of compulsorily contracted
labour and state-controlled wages. From 1904 until the late 1960s the
government used this captive labour pool to build and maintain the
missions and settlements, and as raw material for the lucratively
harvested contract labour market. There is a body of incriminating
financial data which clearly shows the massive sums of money earned by
generations of Aboriginal workers which did not reach their needy
hands. My own intensive research over many years suggests over half a
billion dollars in doubt.
In
a speech to parliament in May last year, premier Peter Beattie admitted
the difficulty of quantifying how much was owed to thousands of workers,
although he conceded that I estimated around $500 million. His
intention, he said in that speech, was to put forward ‘a realistic and
fair offer’ to ‘rectify the wrong’, to ‘bring justice and fairness’ and
give Indigenous people ‘what they are entitled to’. If that last phrase
didn’t make us nervous, the bit about saving the taxpayers of Queensland
millions of dollars in the process, certainly hinted at the plan behind
the spin.
The premier acknowledged he’d been told there were 4,000 potential
litigants ‘waiting in the wings to sue us’ and he admitted the
government had already spent $1.5 million to fight legal challenges –
that is, challenges by claimants seeking their own money. Beattie’s
idea of a ‘fair offer’ to those who had been trapped in the labour
contract system for decades, was either $2000 or $4000, depending on the
age of the claimant. Teams from Queensland’s Aboriginal and Islander
Legal Service Secretariat, briefed and paid by the state government,
visited all communities to advise them of this offer. They told people
that legal action by individuals was not only likely to fail, but was
prohibitively expensive and could – like Mabo – take twelve years to
finalise. This is misleading, to say the least. A test case on Stolen
Wages had already been settled after less than two years litigation, and
the lawyer acted pro bono.
It
is the conditions attached to the Beattie offer which betray the
government’s intent to buy its way out of the massive moral, ethical and
legal debt it owes these workers. Because payment will only go to those
who sign an indemnity relieving the government of any future actions
against it on any of the damnable aspects of a century of controls.
Almost every one of the estimated 16,500 claimants would be signing this
indemnity with no knowledge of their own financial records which are
retained by the government, and they would be signing with no knowledge
of incriminating evidence regarding government mismanagement. Indeed –
as Civil Liberties President Terry O’Gorman has confirmed – they would
be signing without independent legal advice as to their own best
interests,1
a stunning abuse of a basic tenet of legal rights. Yet such is the
desperate poverty, that many will take this pittance nonetheless. It
would seem that Beattie’s idea of ‘justice and fairness’ is far
different than mine.
I’ve read thousands of letters by, to, and within government personnel
covering over 150 years. These politicians and bureaucrats run the
show: they own the turf, and they make the rules. More recently, to the
detriment of democratic accountability, governments control the spin and
keep the media well-fed. And it’s a lonely post, standing on the
outside and crying foul. So the best way we can force change or
accountability, I think, is to beat them at their own game. We need to
check out the current rule book, and use it against them.
So
I turned to the law, in particular the law relating to the management of
trusts and to fiduciary duty. Fiduciary duty attaches to a person or
institution which stands in a position of power over others; it is a
legal duty to act for their benefit, a legal duty not to profit from the
relationship, a legal duty to provide an accurate accounting for monies
held in trust, a legal duty to maintain all documents necessary for such
accounting. If there are breaches of that trust, a fiduciary is liable
to compensate a beneficiary for loss or damage suffered.
Do
we have evidence of breaches of fiduciary duty? Has the government as
banker failed to protect the funds it held in trust? Minister Judy
Spence has frequently asserted that department accounts were regularly
audited and that all remaining savings bank balances were paid to
account holders in the 1970s and 1980s. Should we be surprised that
this ‘spin’ hides all the interesting details? Like the fact that thumb
prints were introduced in 1904 and again in the early 1920s because of
widespread fraud on private accounts by both employers and police
protectors. In 1932 pilfering from private accounts was found to be
common and department supervision was described as ‘totally
inadequate’. During the depression years the government simply seized
private bank interest, although only on Aboriginal accounts. In the
1940s auditors said there was ‘no system of internal checks’ on wage
collections and banking, and withdrawal dockets were marked as witnessed
despite the absence of thumb prints. A 1965 public service inspection
deplored the lack of a central signature register against which to check
‘signed’ withdrawals and concluded there was no way to authenticate the
witnessing of multiple withdrawals. In 1967 it was admitted that lax
head office checks on withdrawals, payments and interest allocation
allowed ‘room for fraud’. In 1970 auditors were still calling urgently
for ‘vital checks’ to be implemented to avoid or deter forgeries. In
1974 – soon after account holders finally got to see a record of
transactions on their accounts – the auditor again criticised head
office controls as faulty.
As
employment broker, the department intercepted all wages, except for a
portion of ‘pocket money’ paid to workers during the period of their
labour contract and supposedly signed for in pocket money books. For
decades the department was warned the system was ineffective; for
decades it refused to change it. In 1932 a Report found there was ‘no
system of inspection’ and therefore it could be ‘reasonably assumed’
that many workers were not getting this prescribed portion of their
wages. In a 1943 survey protectors described the system as a farce and
a direct profit to employers. In 1948 the department rejected as ‘too
costly’ the auditor’s call for external inspections of pocket money
books. In 1956 the department admitted that ‘in many instances’ pocket
money probably was not paid after protectors variously reported the
system as ‘useless’, ‘futile’ and ‘out of control’, with workers
‘entirely at the mercy’ of employers who concocted the figures which
protectors were far too busy to check. Yet this portion of the wages
accounted for up to 80 per cent of individual earnings – a massive loss
of income.
I
– foolishly, as it turned out – thought such evidence, which clearly
demonstrated a multitude of breaches of trust and fiduciary laws, would
decisively clinch legal action by Aboriginal plaintiffs. But
apparently, for successful action, breaches of law must be bolstered by
precedents from other relevant cases, and in Australia there are no such
cases relating to management of Aboriginal monies, except the one that
was settled, and therefore remains confidential.
So
where do we turn for justice?
For some time my thoughts have been turning to the United States. Here,
since mid-1996, the US federal government has been fighting – and losing
– a class action brought on behalf of 300,000 past and present
account holders which asserts that monies due to them which were
collected and managed by the government, have never been accurately
accounted for.2
The funds at stake, like those in Queensland, belong to individuals.
In
the Individual Indian Money (IIM) case these funds were generated from
the sale or lease of natural resources on Indian lands allotted (by
treaties) as reserves. It is estimated that the government amassed
billions of dollars during the twentieth century through farming and
grazing leases, and sales of timber, oil and gas on Indian reserves. It
is alleged there is no way of knowing whether this money was fully
disbursed to IIM account holders because the government failed ever,
during one hundred years of management, to properly account for the IIM
funds it controlled, it failed to prudently manage trust assets, it
refused to correct defects in its accounting system, and its accounting
of assets was fundamentally flawed and completely ineffective.
Consequently billions of dollars remain unaccounted for.3
What parallels can be drawn to the Queensland case? The primary point
of difference is the generation of the missing funds: in Australia
proprietorship of reserve lands was not ceded by treaty to Aboriginal
groups who remain tenants on their own country. However this is not the
issue. The US case centers on the mismanagement of private funds by
government, as does the Queensland campaign. The funds in question in
Queensland are largely those of individual workers whose wages were
quantified and collected, and whose savings were withheld, supervised,
levied, transferred and invested – and too frequently defrauded and
misused – by government agents. Also under question are child endowment
and pension payments intercepted by government (since 1943 and 1959
respectively) and only partially distributed to endowees: in 1960, for
instance, the department estimated over half a million dollars (today’s
value) of settlement pensions went directly to consolidated revenue.
There is no doubt Queensland Aboriginal account holders can pose the
same charges as their IIM colleagues: that it is up to the government to
provide an accurate accounting of its management of private wages and
savings of account holders; that the government must fully account for
dealings on Trust funds, that it failed to properly manage Trust assets,
that it refused to correct systemic defects in its accounting system,
and that its registration of assets was grossly inadequate.
How has the US case fared in the courts? In June 1999 secretary of the
Interior Bruce Babbitt admitted that the fiduciary responsibilities of
the government to the IIM beneficiaries were not being fulfilled, and
his Bureau of Indian Affairs counterpart admitted that the asset
management system was faulty. In December that year the court ruled the
US government had breached its trust responsibilities to individual
trust beneficiaries. A subsequent appeal was rejected: the three-judge
panel noted specifically ‘the magnitude of government malfeasance at
issue in the case’ and held that the government had an obligation to
account for every dollar from the inception of the trust.4
This last point has particular resonance for Queensland claimants,
because the IIM class action is mounted on behalf of past as well
as present account holders: it has sought, and has been accorded,
accountability for financial deprivation enduring across generations.
Whereas in Queensland, just to give you the context, only those ‘still
alive on 9 May 2002’ (as the brochure so succinctly informs us) are
entitled to make a claim. If you worked for forty years and struggled
to bring up your family in poverty for all that time, and if you died in
poverty in February 2002, your underpaid life and labour remain a
financial gain to the state. What was it premier Beattie said about a
win for Queensland taxpayers?
In
December 1999, in what he described as a ‘stunning victory’ for the
Indian plaintiffs, Judge Lambeth ruled that US mismanagement of the IIM
trust ‘is far more inexcusable’ than misuse of normal donative trusts
because ‘the beneficiaries of this trust did not voluntarily choose to
have their lands taken from them’ (and managed by the government), and
also, he said, because the plaintiffs were among ‘the poorest people in
this nation’. ‘The interests at stake’, acknowledged the Circuit Judge
in February 2001, ‘are not merely economic…but personal interests in
life and health.’
This applies equally to Queensland. Aboriginal workers did not
choose to be controlled by the department, and certainly did not
choose for the department to intercept and administer their
earnings. There can be no dispute that the great majority of
‘beneficiaries’ of this system were, and still are, trapped in appalling
poverty.
Despite a wealth of incriminating evidence from government agents
demonstrating official knowledge of enduring negligence, mismanagement
and misappropriation, there has never been a proper accounting to
Aboriginal people of the savings and associated Trust monies
superintended by government during the twentieth century. Instead, the
Beattie government offers a pittance to the survivors and demands an
indemnity without disclosing the full facts to the claimants. And it
uses the full weight of its legal and financial resources to thwart
those who are brave enough to take action through the courts.
So
that’s one of the issues I’m working on today. The courts have rules
and precedents which governments cannot so easily manipulate. I want to
take this fight out of the tawdry environment of political spin. I want
to put the onus on the government, as financial trustee and as
fiduciary, to fully account for its management of Aboriginal monies and
Aboriginal lives. I want to use the inspiration and example of the
Blackfeet people of Montana as our template to achieve legal justice
through court directives that governments must obey.
Because for as long as this historical debt remains unresolved our
claims to be the land of the ‘fair go’ will ring hollow.
*
This paper is in part adapted from ‘Abuse of Trust: the government as
banker in Queensland and in the US’, appearing in the Indigenous Law
Bulletin, September 2003.
1
National
Indigenous Times,
5.3.03.
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